October 16 Passed. Perplexity Is Still Citing Reddit at 47%.

Three weeks ago, the most common framing in AEO coverage was that October 16 would reshape Perplexity's Reddit citations. The discovery deadline in Reddit's federal lawsuit against Perplexity would force some kind of legal resolution -- settlement talks, an injunction application, or at minimum a clearer signal about where the case was headed. We contributed to that framing in our October 4 investigation.

October 16 came and went. Perplexity is still citing Reddit in 47% of its responses. The case has not resolved. Here is what actually happened -- and what it means for how you should think about Reddit as a Perplexity visibility lever.

What the October 16 Deadline Was

Reddit filed its federal lawsuit against Perplexity in October 2025 (SDNY, Case No. 25-cv-8736, Judge Paul A. Engelmayer), targeting Perplexity-User -- Perplexity's live-fetching crawler that explicitly ignores robots.txt. The core legal theory: robots.txt enforcement constitutes a "measure that controls access to copyrighted work" under DMCA Section 1201(a), and Perplexity-User's deliberate bypass violates it.

The case's first major decision came July 31, 2026: Judge Engelmayer denied Perplexity's motion to dismiss in a 63-page ruling, keeping Reddit's DMCA anti-circumvention claims alive. The case moved into discovery. October 16 was scheduled as the close of primary fact discovery.

In our October 3-4 investigation (`knowledge/reddit-as-aeo-signal.md`, Scout sessions 157-158), we treated this deadline as a potential inflection point. After discovery closes, one of three things typically follows: settlement, motion practice toward trial, or an injunction application. Any of those could change how Perplexity accesses Reddit content.

What Actually Happened After October 16

Discovery on the main DMCA and scraping claims closed on schedule. No settlement announcement followed. What followed instead was procedural maneuvering that extended the case's timeline well into 2027.

At the October 1 conference, Judge Engelmayer set two milestones: an October 27 hearing and an April 5, 2027 date that serves as a pretrial milestone on the case's trial track (Scout session 159, October 5, 2026, `knowledge/reddit-as-aeo-signal.md`). The October 27 hearing proceeded as scheduled.

The day after that hearing -- October 28, 2026 -- Judge Engelmayer issued an order that significantly changed the picture.

The Live Testimony Order: What It Signals

In September 2026, Perplexity dropped Keker, Van Nest & Peters and sought to retain Proskauer Rose as new trial counsel. Reddit objected: Proskauer had previously represented Reddit in a separate matter, creating a potential conflict of interest. Both parties filed competing briefs on October 9. The judge reviewed them.

Judges typically rule on attorney conflict motions from written briefs alone. On October 28, Judge Engelmayer did something different: he ordered two Proskauer Rose attorneys and Reddit's deputy general counsel to appear for in-person live testimony (Scout session 187, November 2, 2026, `knowledge/reddit-as-aeo-signal.md`).

Ordering live testimony signals that the judge views the factual dispute -- whether Proskauer's prior relationship with Reddit created a binding no-compete commitment -- as requiring direct credibility assessment, not just document review. It is procedurally stronger for Reddit's position than a ruling-on-briefs scenario would have been.

No date for the testimony hearing has been set in public records as of November 2, 2026. Until the conflict motion resolves, Keker's withdrawal motion remains pending. Perplexity's legal representation situation is unresolved and not moving quickly.

The Citation Rate Has Not Changed

Throughout all of this, Perplexity-User has continued fetching Reddit content in real time. Our August 23, 2026 spot test found Perplexity citing Reddit in 47 of 100 responses -- stable even after Reddit's August 20 robots.txt update explicitly blocking Perplexity-User. The crawler ignored it.

That figure comes from our August 30, 2026 methodology rec on Perplexity-Reddit platform routing (`methodology-recs/2026-08-30-perplexity-reddit-platform-routing-update.md`, Scout session 123). We noted at the time that Perplexity's Reddit advantage had migrated specifically from ChatGPT's collapse: Pierview's dataset covering 44,488 Reddit citations from July 1 through August 19, 2026 found Perplexity holding 71% of cross-platform Reddit citations. ChatGPT held 23%.

The legal proceedings have not produced an injunction against that crawling behavior. As of this writing, the mechanism sustaining the 47% rate -- Perplexity-User fetching from Reddit in defiance of robots.txt -- remains live.

The Forward Scenarios

Our three-scenario model from October 3-4 (sessions 157-158) is unchanged in direction, shifted in timeline.

**Settlement with licensing (MEDIUM probability):** Perplexity pays Reddit for data access, similar to the licensing deals OpenAI and Google signed before this lawsuit. As post-discovery costs accumulate on both sides -- and the live testimony phase adds further procedural complexity -- this path becomes more economically rational for Perplexity.

**Adverse ruling or injunction (MEDIUM probability):** Reddit's SearchGuard DMCA theory survived dismissal and is now supported by a 63-page opinion. If Reddit obtains an injunction targeting Perplexity-User, the 47% citation rate would collapse the same way ChatGPT's did in August -- quickly, structurally, and without a path back without paying for access.

**SerpApi antitrust counterclaims (LOW probability, downgraded October 2):** SerpApi filed antitrust counterclaims in August alleging Reddit's exclusive deal with Google constitutes illegal selective access control. We assessed this as potentially significant (Scout session 157). The same week, Judge Engelmayer stayed discovery on those counterclaims pending Reddit's motion to dismiss (session 158). We downgraded this scenario's probability from LOW-MEDIUM to LOW. It remains a possible upside for Perplexity but is no longer a near-term variable.

The honest assessment is the same as it was in October: two scenarios with opposite outcomes for Perplexity, both MEDIUM probability. The timeline has changed materially. The case will not resolve before 2027.

What This Means for Business Strategy

For home services, local trades, and service businesses, Reddit is not the primary Perplexity citation lever -- local directory presence is. Yelp, Foursquare, and Google Business Profile continue to drive citations across ChatGPT, AI Mode, and Perplexity regardless of how the lawsuit resolves. The fix plan for a plumber or HVAC contractor does not change based on SDNY proceedings.

If your business already has Reddit presence -- mentions in city subreddits, organic threads where your brand comes up -- that presence is worth more now than it appeared in October. The window for it to matter on Perplexity extends at least to 2027. Maintaining it has a clearer return than it did when October 16 looked like a near-term decision point.

If you don't have Reddit presence and were considering building it specifically to capture Perplexity citations: the case extension does not change the fundamental calculus. Reddit community presence is a 6-18 month investment with no discrete completion state, and no current data suggests the volume threshold for citation impact has changed.

What no court outcome touches: a complete Yelp listing feeds ChatGPT directly via the July 2026 data partnership. Google Business Profile affects AI Mode. LocalBusiness schema with sameAs links matters across every platform. A Signal Check at sourcepull.ca will tell you which of those signals you're currently failing on -- and whether Perplexity is actually the gap costing you citations, or whether the more actionable fixes are on signals that no lawsuit touches.

--- *Research sources: Scout sessions 157-158 (October 3-4, 2026, SerpApi antitrust counterclaims and discovery stay), session 159 (October 5, case management schedule), session 173 (October 19, competing Proskauer briefs), session 187 (November 2, live testimony order). August 23 citation rate data from Scout session 123, `methodology-recs/2026-08-30-perplexity-reddit-platform-routing-update.md`. Primary sources include Law360, chatgptiseatingtheworld.com, ailawsuittracker.com, and Pierview citation data.*